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Accounting Policies of Salora International Ltd. Company

Mar 31, 2015

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,2013.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets ( except freehold land ) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fixed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to statement of Profit & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Persuant to Companies Act, 2013 ('the Act') being effective from 1April 2014, the Company has revised Depreciation rates on tangible fixed assets as per the usefull life specified in part 'C' of schedule II of the Act. Depreciation on Fixed Assets is provided as per Straight Line method on the basis of useful life of assets specified and in the manner specified in the Schedule II of the Companies Act, 2013. Depreciation is charged on pro-rata basis on Additions/Sales during the year. Depreciation on assets whose actual cost do not exceed Rs.5000/- has been charged 100% without pro-rata basis. Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period. Intangible assets are amortised over the useful life of such assets.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the statement of Profit and Loss on a straight-line basis over the lease term. Lease under which the Company assumes substantially all the risk and rewards of ownership are classified as operating lease. Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease,whichever lower.

v) Investments :

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary,in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the customizability for duties is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee Benefits :

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the statement of Profit and Loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and otherlong term benefits are charged to the statement of Profit and Loss.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to statement of Profit & Loss as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to statement of Profit & Loss on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. ) Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. ) Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to statement of Profit & Loss.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to statement of Profit & Loss.

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.


Mar 31, 2014

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,1956.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets (except freehold land ) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fixed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to statement of profit & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956. Depreciation is charged on pro-rata basis on additions/ sales during the year. Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period. Assets purchased after 15.12.1993 the actual cost of which does not exceed Rs. 5000/- are written off in the year of acquisition. Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the statement of profit and Loss on a straight-line basis over the lease term. Lease under which the Company assumes substantially all risk and rewards of ownership are classifed as operating lease. Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease,whichever lower.

v) Investments :

Investments are classifed into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long- term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary,in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured fnished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of fnished goods.

c. Cost is calculated on weighted average basis.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on fnished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duties is provided at the end of the year on fnished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee benefits :

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the statement of profit and loss of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the statement of profit and Loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the statement of profit and Loss.

d. Contribution to Employees'' Provident Fund and Family Pension Scheme are charged to statement of profit & Loss as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to statement of profit & Loss on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees'' Gratuity & Leave pay paid is charged to statement of profit & Loss.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to statement of profit & Loss.

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.


Mar 31, 2013

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,1956.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty.Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets (except freehold land) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fxed assets is reduced from the cost of respective assets. Borrowing costs that are attributable to the acquisition or construction of fxed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred. Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to statement of Proft & Loss. Intangible assets are recorded at cost of acquisition less accumulated depreciation/amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956. Depreciation is charged on pro-rata basis on additions/ sales during the year. Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period. Assets purchased after 15.12.1993 the actual cost of which does not exceed R 5000/- are written off in the year of acquisition. Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the statement of Proft and Loss on a straight-line basis over the lease term. Lease under which the Company assumes substantially all the risk and rewards of ownership are classifed as operating lease. Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease, whichever lower.

v) Investments :

Investments are classifed into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long-term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary,in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured fnished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of fnished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identifed at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on fnished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duties is provided at the end of the year on fnished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee Benefts :

a. Short term employee benefts are recognised as an expense at the undiscounted amount in the statement of Proft and Loss of the year in which the related service is rendered.

b. Defned Contribution Plans for Provident fund, Family pension and Superannuation benefts are recognised by contribution at specifed rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefts Gratuity and Leave Pay are recognised as an expense in the statement of Proft and Loss for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefts are charged to the statement of Proft and Loss.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to statement of Proft & Loss as incurred under the relevant Act.

e. Gratuity and Superannuation benefts are charged to statement of Proft & Loss on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to statement of Proft & Loss.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the fnancial year and exchange difference is charged to statement of Proft & Loss.

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outfow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outfow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.


Mar 31, 2011

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act,1956.

ii) Revenue Recognition :

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty. Export Sales are recognised as and when the goods are cleared by custom authorities.

Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets :

Fixed assets ( except freehold land ) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat,Vat etc. claimed on fixed assets is reduced from the cost of respective assets.

Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred.

Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to Profit & Loss Account.

Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956.

Depreciation is charged on pro-rata basis on additions/ sales during the year.

Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period.

Assets purchased after 15.12.1993 the actual cost of which does not exceed Rs. 5000/- are written off in the year of acquisition.

Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the Profit and Loss Account on a straight-line basis over the lease term.

Lease under which the Company assumes substantially all the risk and rewards of ownership are classified as operating lease.

Such assets acquired are capitalised at fair value of the assets or present value of the minimum lease payments at the inception of the lease, whichever lower.

v) Investments :

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long-term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporary, in the value of long term investments.

vi) Inventory Valuation :

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port / warehouse of the custom. Liability for duties is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,vat under cenvat scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under cenvat scheme on expenses is reduced from expenses.

viii) Employee Benefits :

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the profit and loss account of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to Profit & Loss Account as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to Profit & Loss Account on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f. Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year.

g. Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to Profit & Loss account.

ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to Profit & Loss Account

x) Taxation :

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation.

xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.




Mar 31, 2010

I) Basis of Accounting :

The Financial Statements are prepared under the historical cost convention on accrual basis as a going concern, in accordance with applicable Accounting Standards and relevant presentational requirements of the Companies Act, 1956.

ii) Revenue Recognition:

Sales are recognised on the despatch of goods to customers and accounted for including Excise Duty, excluding Sales tax / VAT and net of returns & claims etc. Net Sales as disclosed are net of Excise Duty.Export Sales are recognised as and when the goods are cleared by custom authorities. Service Income is recognised as and when the service is complete.

iii) Fixed Assets and Depreciation:

a. Fixed Assets:

Fixed assets (except freehold land) are stated at cost of acquisition and/or cost of construction, less accumulated depreciation Cenvat.Vat etc. claimed on fixed assets is reduced from the cost of respective assets.

Borrowing costs that are attributable to the acquisition or construction of fixed assets are capitalized as part of cost of such assets till such time as the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the period in which incurred.

Fixed assets are reviewed for impairment of such assets by taking them as part of a cash generating unit and on assets not in use basis on each Balance Sheet date, Impairment loss and reversal of earlier years, if any is recognised to Profit & Loss Account.

Intangible assets are recorded at cost of acquisition less accumulated depreciation / amortisation.

b. Depreciation on Fixed Assets :

Depreciation is provided on straight-line method, except for Vehicles on which it is provided on written down value method, at the rate and in the manner as prescribed in Schedule XIV of the Companies Act, 1956.

Depreciation is charged on pro-rata basis on additions/ sales during the year.

Cost of leasehold land and furnishing expenses in leasehold property are amortised over the lease period.

Assets purchased after 15.12.1993 the actual cost of which does not exceed Rs. 5000/- are written off in the year of acquisition.

Intangible assets are amortised over the useful life of such assets. The useful life thereof is estimated to be ten years.

iv) Lease Assets:

Lease rental in respect of assets taken on operating lease are charged to the Profit and Loss Account on a straight-line basis over the lease term.

Lease under which the Company assumes substantially all the risk and rewards of ownership are classified as operating lease.

Such assets acquired are capitalised at fair value of the asset or present value of the minimum lease payments at the inception of the lease,whichever lower.

v) Investments:

Investments are classified into Current and Long-term investments. Current investments are stated at the lower of cost or fair value. Long-term investments are stated at cost. Provision for diminution is made to recognise a decline, other than temporaryin the value of long term investments.

vi) Inventory Valuation:

a. Inventories are valued at cost or net realisable value whichever is lower.

b. Cost of manufactured finished goods and work in progress includes cost of material, labour and manufacturing overheads and excise duty in case of finished goods.

c. Cost is calculated on FIFO basis in respect of Infocom Products and on weighted average basis in respect of Consumer Electronic Product & components thereof.

d. Obsolete, defective and non/ slow moving inventories are identified at the year end and adequate provision is made in respect thereof.

vii) Excise Duty, Custom Duty & Cenvat:

a. Excise duty on finished goods and custom duty on raw material is accounted for on clearance of goods from the factory, port/ warehouse of the custom.Liability for duties is provided at the end of the year on finished goods stock in factory and raw material stock in custom bonded warehouse or under clearance.

b. Credit of excise duty,VAT under CENVAT scheme on goods purchased, is reduced from the cost of purchase.

c. Credit of service tax under CENVAT scheme on expenses is reduced from expenses. viii) Employee Benefits:

a. Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit and Loss account of the year in which the related service is rendered.

b. Defined Contribution Plans for Provident fund, Family pension and Superannuation benefits are recognised by contribution at specified rate or percentage on salary. No actuarial assumptions are required to measure the obligations or expenses and there is no possibility of any actuarial gain or loss. Moreover the obligations are measured on an undiscounted basis.

c. Other Post employment and long term employee benefits Gratuity and Leave Pay are recognised as an expense in the Profit and Loss account for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and other long term benefits are charged to the Profit and Loss account.

d. Contribution to Employees Provident Fund and Family Pension Scheme are charged to Profit & Loss Account as incurred under the relevant Act.

e. Gratuity and Superannuation benefits are charged to Profit & Loss Account on the basis of payments made to the trust as per actuarial valuation at the end of the year.

f.) Liability in respect of leave pay is provided on the basis of actuarial valuation at the end of the year. g.) Differential / extra / temporary employees Gratuity & Leave Pay paid is charged to Profit & Loss account. ix) Foreign Currency Transactions :

Transactions in foreign currency are accounted for at the exchange rates prevalent on the date of transaction. Monetary assets and monetary liabilities related to foreign currency transactions remaining unsettled at the end of the year are worked out at the exchange rate prevalent on the last day of the financial year and exchange difference is charged to Profit & Loss Account.

x) Taxation:

Income-tax expense comprises current tax and deferred tax charge or credit. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assets arising mainly on unabsorbed depreciation under tax laws, are recognised, only if there is a virtual certainty of its realisation, supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extent there is a reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation. xi) Contingent Liabilities and Assets :

Contingent liability is recognised and provided for when the Company has present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligations and of which a reliable estimate can be made. Contingent liability is disclosed in notes to accounts in case of obligation is disputed and the possibility of an outflow of resources is remote. Contingent assets is not recognised until the realisation of income is virtually certain.



 
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